Introductions for financial services (including regulated mortgage, general insurance and pure protection contracts)
Introductions for financial services (including regulated mortgage, general insurance and pure protection contracts)

The following Practice Compliance guidance note provides comprehensive and up to date legal information covering:

  • Introductions for financial services (including regulated mortgage, general insurance and pure protection contracts)
  • Difference between introduction to and instructing a third party
  • What is an introduction?
  • Why do firms introduce clients to financial advisors?
  • Core duties
  • Mortgage, insurance and protection contracts
  • Introductions to financial advisors
  • Restricting freedom of choice for financial services
  • Appointed representative
  • Evaluating and selecting third parties for financial services or advice
  • more

This Practice Note explains additional regulatory requirements that apply when you introduce a client to a third party for financial services, including regulated mortgage, general insurance and pure protection contracts. It should be read in conjunction with Practice Note: General introductions to third parties—regulatory requirements, which sets out generic regulatory requirements.

Difference between introduction to and instructing a third party

Chapter 6 of the SRA Code of Conduct 2011 imposes specific obligations in relation to introductions to third parties. There is no definition of 'third party', but the introductory notes to chapter 6 of the Code give the following examples:

  1. another lawyer 

  2. a financial services provider

This suggests chapter 6 relates to introducing your client to external third parties, rather than instructing third parties such as barristers or experts on behalf of your client as part of the matter you are handling for them. For an explanation of the practical difference between instructing and introducing a client to a third party, see Practice Note: Introductions to third parties—regulatory requirements—Difference between introduction to and instructing a third party.

What is an introduction?

The SRA does not define the terms 'introduction' or 'introduce'. In chapter 6 of the Code, the SRA uses the following terms interchangeably:

  1. introduce

  2. refer

  3. recommend

None of these terms is defined and they should therefore be given their everyday